Scotland is closer to independence now than at any stage since the Treaty of Union in 1707. Together with a growing number of people in Scotland, I welcome this development as genuinely exciting and look forward to the benefits of self-government with enthusiasm.

The next few years present a historic opportunity to secure improved governance on these islands as respected equals and a recognition that the social union we share and value can go from strength to strength.

The polls in May produced the biggest political landslide in living Scottish and UK political memory, as the SNP leader, Alex Salmond, has described in an interview with the Guardian. Nationalist candidates were victorious in 53 of 72 constituencies, while on the list vote in the proportional representation (PR) election the SNP was first in all bar three seats. Salmond was re-elected as first minister of the only majority government administration in the UK.

Throughout the election campaign the SNP reiterated that an independence referendum would be held in the second half of the parliamentary term. The other parties opposed a referendum and lost badly at the ballot box.

Just as with devolution proposals in 1997, it will be for people living in Scotland to decide their future. Having received a mandate to put the question, the Scottish government will bring forward plans for the referendum.

The demand for greater self-government is a natural consequence of devolution. Since the re-establishment of the Scottish parliament in 1999 decision-making has been distinct in Scotland with a political consensus different to that at Westminster. Key public services from education, health and law and order are steered from Holyrood not the House of Commons and it is a significant improvement.

Quite rightly, people look to the Scottish parliament as the fulcrum of Scottish democratic life. However, at this time of economic and social challenge the artificial limitations of devolution are there for all to see. Scotland's public finances are still determined through Westminster. We are straitjacketed into UK taxation and welfare policies. This leave us with both an economic disadvantage and unable to resist Tory attacks against the weakest in society.

Meanwhile, despite overwhelming public opposition in Scotland the UK government is prepared to spend up to £100bn on a new generation of Trident nuclear submarines and station them where the population don't want them, namely Scotland.

No normal country would put up with this, and we are no different.

On the other hand there is an attractive alternative. We can develop the powers of the Scottish parliament so that Scotland can raise and spend its own revenue, ending once and for all the misinformed and misleading "subsidy" debate. Policy-makers in Scotland could then make sensible use of job creating powers and establish a more competitive environment for businesses to help grow the economy.

In essence, what would change is that remaining legislative powers would move from Westminster to Holyrood. Scottish MPs would no longer be required at Westminster, ending the absurdity of the West Lothian question where Scottish MPs from the UK parties determine policy in England, while English MPs correctly have no say on devolved policies.

What remains unchanged, however, is that which matters to people across these islands; our social union, which we share and works well. From the monarchy to the BBC and other common institutions, much will continue as today.

Anyone who has been to Scandinavia will attest to the shared Nordic identity, cultural values and public policy which sees Danes, Swedes and Norwegians share progressive domestic social agendas and are world leaders in international aid and peace policy. They have common diplomatic and military arrangements, share an airline and work together through the Nordic Council.

In exactly the same way, we will have the closest of relations on these islands, as good neighbours and friends, but it will be a 21st century relationship with continuing multilayered personal and community identities. The British-Irish Council will take on a more important role.

Twenty-first century independence will be good for people in Scotland. I think it will also be transformative for people in England, Wales, Northern Ireland and the Irish Republic.